AMENDMENT, AGREEMENT AND WAIVER

AMENDMENT, AGREEMENT AND WAIVER dated as of August 7, 2008 (this “ Amendment ”), in respect of the Credit Agreement, dated as of March 17, 2006 (as previously amended, restated, supplemented or otherwise modified and in effect from time to time, the “ Existing Credit Agreement ”; as amended hereby and as further amended, restated, supplemented or otherwise modified and in effect from time to time, the “ Credit Agreement ), by and among AHR CAPITAL BOFA LIMITED (“ AHR ”) as a borrower, each of the borrowers from time to time party thereto (together with AHR, collectively, the “ Borrowers ”), ANTHRACITE CAPITAL, INC. (“ Anthracite ”, and together with the AHR and the other Borrowers, collectively, the “ Anthracite CA Parties ”) as borrower agent (in such capacity, the “ Borrower Agent ”) and BANK OF AMERICA, N.A. (“ BANA ”) as lender (in such capacity, the “ Lender ”). Capitalized terms used but not otherwise defined herein shall have the meanings given to them in the Credit Agreement.

WHEREAS, the Anthracite CA Parties and the Lender are parties to the Credit Agreement;

WHEREAS, as a condition to the Credit Agreement, Anthracite has executed that certain Parent Guaranty, dated as of July 17, 2006 (the “ Guaranty ”), made by Anthracite in favor of the Lender.

WHEREAS, pursuant to that certain Borrowing Base Deficiency Event Notice, dated as of July 29, 2008 (the “ July Borrowing Base Deficiency Event Notice ”), the Lender has (i) notified the Anthracite CA Parties that a Borrowing Base Deficiency Event has occurred (the “ July Borrowing Base Deficiency Event ”) and (ii) requested that the Borrowers make a payment to the Lender in accordance with the Additional Terms Schedule attached hereto as Schedule 1 (the “ Additional Terms Schedule ”);

WHEREAS, the Lender has agreed, subject to the terms hereof, to allow the Borrowers to pay outstanding amounts due to the occurrence of the July Borrowing Base Deficiency Event pursuant to a schedule of payments;

WHEREAS, Anthracite Capital BOA Funding LLC (“ Anthracite Funding ”), a wholly-owned subsidiary of Anthracite, is party to that certain Master Repurchase Agreement, dated as of July 20, 2007 (as amended, restated, supplemented or otherwise modified from time to time, the “ Repurchase Agreement ”), by and among Anthracite Funding as seller (the “ Seller ”), BANA, as buyer agent (in such capacity, the “ Buyer Agent’ ) and buyer, and Bank of America Mortgage Capital Corporation as buyer (“ BAMCC ”, together with BANA, collectively, the “ Buyers ”; the Buyers, the Buyer Agent and the Lender, collectively, the “ BOA Parties ”);

WHEREAS, pursuant to that certain Portfolio Margin Deficit Notice, dated as of July 29, 2008 (the “ July Portfolio Margin Deficit Notice ”), the Buyer Agent has (i) notified the Seller that a Portfolio Margin Deficit (as defined in the Repurchase Agreement) exists (the “ July Portfolio Margin Deficit ”) and (ii) requested that the Seller make a payment to the Buyer Agent, for the benefit of the Buyers in accordance with the Additional Terms Schedule;

WHEREAS, the Buyer Agent and the Sellers have agreed, subject to the terms of the Repo Amendment (as defined below), that the Seller will pay the remaining balance of the July Portfolio Margin Deficit pursuant to a schedule of payments;

WHEREAS, simultaneously with this Amendment, the Seller, the Buyers and the Buyer Agent shall execute an amendment to the Repurchase Agreement (the “ Repo Amendment ”);

WHEREAS, the Anthracite CA Parties have agreed to amend and restate the Collateral Documents to grant, as collateral security for the prompt and complete payment and performance when due (whether at the stated maturity, by acceleration or otherwise) of (i) the Seller’s obligations under the Repurchase Agreement, including, without limitation, the Seller’s obligations to make the Repo Deferred Payments (as defined in the Repo Amendment), and (ii) Borrowers’ obligations under the Credit Agreement, including without limitation, the Borrowers’ obligation to make the CA Deferred Payment (as defined below), a security interest in the Collateral;

WHEREAS, Anthracite Funding has agreed to grant, as collateral security for the prompt and complete payment and performance when due (whether at the stated maturity, by acceleration or otherwise) of the Obligations, a security interest in the Collateral (as defined in the Affiliate Security Agreement); and

WHEREAS, the Anthracite CA Parties and the Lender have agreed, subject to the terms and conditions of this Amendment, that the Credit Agreement shall be amended as set forth below.

NOW THEREFORE, the Anthracite CA Parties and the Lender hereby agree, in consideration of the mutual premises and mutual obligations set forth herein, the receipt and sufficiency of which is hereby acknowledged, as follows:

SECTION 1.   Amendments .

(a)   Section 1.01 of the Existing Credit Agreement is hereby amended by deleting the definition of “Termination Date” in its entirety and substituting in lieu thereof the following new definition:

““ Termination Date ” shall mean September 18, 2010.”

(b)   Section 1.01 of the Existing Credit Agreement is hereby amended by adding the following new definitions in proper alphabetical order:

““ Additional Terms Schedule ” means the Additional Terms Schedule, attached as Schedule 1 to the Amendment, Agreement and Waiver, as the same may be modified from time to time.

“ Amendment, Agreement and Waiver ” shall mean that certain Amendment, Agreement and Waiver, dated as of August 7, 2008, by and among the Borrowers, the Borrower Agent and the Lender.

“ Buyer Agent ” shall mean Bank of America, N.A.

“ CA Deferred Payment ” shall have the meaning specified therefor in the Amendment, Agreement and Waiver.

“ Repo Deferred Payments ” shall mean the term “Repo Deferred Payments” as defined in the Repurchase Agreement.

“ Repo Obligations ” means Seller’s obligations: (a) to fully and promptly pay all sums owed under the Repurchase Documents (as defined in the Repurchase Agreement), including, without limitation, the Repo Deferred Payments, at the times and according to the terms required by the Repurchase Documents, without regard to any modification, suspension, or limitation of such terms not agreed to by the Buyer Agent, such as a modification, suspension, or limitation arising in or pursuant to any Insolvency Proceeding (as defined in the Repurchase Agreement) affecting Seller (even if any such modification, suspension, or limitation causes Seller’s obligation to become discharged or unenforceable and even if such modification was made with the Buyer Agent’s consent or agreement); and (b) to perform al